Chapter 29 of the Massachusetts General Laws governs State Finances. Section 5B requires that the Secretary of Administration and Finance monitor state revenues and provide updates to the Governor and Legislature by October 15, January 15 and April 15 of each year when necessary. If projected revenues are insufficient to meet authorized spending, section 9C states that the Secretary must notify the Governor within 5 days. Within 15 days of being notified, the Governor is required to reduce authorized spending or increase revenues to offset the projected shortfall.
Budget reductions are limited to accounts that fall under the control of the Governor or a secretary, and which do not provide direct local aid (an example is Chapter 70 school funding). Additional revenues may include transfers from the Commonwealth Stabilization Fund, which require approval from the Legislature.
This information provided by the Executive Office of Administration and Finance.